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Alberta’s Orphan Well Cleanup Fund Underfunded by $1.2 B as Levy Reconsideration Sought

Landowner Dwight Popowich has requested a hearing to seek higher levies under Alberta’s polluter-pay law

A new report from the University of Calgary's Public Interest Law Clinic estimates the amount of money charged to oil companies to clean up abandoned wells is more than $1 billion short of what the cleanup will cost.
An orphan oil well, still with a pumpjack on it, and an orphan collecter oil battery near Carmangay, Alberta on Sept. 10. 2020. Orphan wells and facilities do not have parties responsible for decommissioning or reclamation activities. Alberta's Orphan Well Association (OWA) decommissions non-producing and abandoned oil/gas wells and facilities. (THE CANADIAN PRESS IMAGES/Larry MacDougal)
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Overview

  • A report by former University of Calgary clinic lawyer Drew Yewchuk finds that current and past levies leave a $1.2 billion gap in funding for orphan well cleanup.
  • The Orphan Well Association oversees more than 3,700 wells needing decommissioning and reclamation at an estimated cost of over $860 million.
  • The association must also repay upwards of $300 million in federal and provincial loans within the next decade, further straining its budget.
  • This fiscal year’s levy was set at $144 million by the Alberta Energy Regulator, a figure critics say continues a pattern of underfunding.
  • Landowner Dwight Popowich has filed a request for a regulator-reviewed hearing to argue that higher levies are required to uphold the polluter-pay principle.